One year on from the Banking Royal Commission, what has changed?

It’s been a tumultuous year since commissioner Kenneth Hayne handed down his recommendations following the banking royal commission. But what has actually changed over the past 12 months and what impact has the commission had on the industries it explored?

What’s changed for banks and lenders?

The royal commission put a spotlight on the banking sector, exposing poor practices to people inside the industry and out. Over the past year, the big banks in particular have had to make amends to their customers, and 25 institutions have signed on to a new Banking Code of Practice that sets a new standard for the industry to conform to. There are now greater incentives for banks and lenders to act in the best interests of customers. Banking executives’ roles and accountabilities are subject to stricter observation under the Banking Executive Accountability Regime, and ASIC has begun taking a more active approach to enforcement. While the past year has undoubtedly been a rough one, however, many banks and lenders are already using the changes to rebuild relationships with customers and develop services that better align with consumer expectations.

What’s changed for brokers?

When the recommendations from the royal commission were first handed down, the broking community was shocked by the suggestion that trailing commissions be banned and that the borrower, not the lender, should pay broker fees in connection with home lending. While this recommendation wasn’t implemented by the government, the broking community has still felt the impact of legislative changes. The key changes the industry will need to implement include: establishing a compulsory scheme to check references for prospective mortgage brokers; more thoroughly vetting applicants’ ability to repay their loan under tighter responsible lending guidelines; mandatory misconduct reporting and compensation arrangements for customers; and ensuring they are acting in line with the ‘best interest duty’, that protects consumers from potential conflicts of interest that might cause brokers to recommend an unsuitable product.. While these changes may frustrate some, their implementation will only strengthen brokers’ unique position amongst both customers and industry as trusted, respected intermediaries. On the whole, mortgage brokers have found themselves in a privileged position as a result of the royal commission. With banks and lenders under intense scrutiny, brokers – with their personal customer relationships and long-standing customer-centric approach – have continued to progress the role of trusted advisor, able to provide context and offer recommendations to uncertain consumers.

What’s changed for consumers?

At the end of the day, all the recommendations and legislative changes brought about by the royal commission are aimed at one thing: improving the financial system for the benefit of its customers. And it’s in the best interest of the industry to improve consumer outcomes in order to regain the trust (and business) of customers. The full impact of the royal commission remains to be seen. But what has already changed for consumers is their ability and willingness to question whether they’re getting the best deal from their current bank, lender or broker, and the increasing range of alternative options available to help them improve their financial situation and wellbeing. Of course, there is still more work to do and some things remain unchanged. In the case of broker clawback, for example, banks are still charging brokers if a home loan they write is refinanced within two years of settlement. This practice is good for the banks, who reduce customer churn. For consumers and brokers it’s another story. Brokers are disincentivised to switch consumers to a better rate during this period for fear of being hit with a penalty that negates any income earned., It is a potential area for future reform to drive competitive outcomes for consumers.. As more of the royal commission recommendations are implemented, it will be interesting to see what else changes, what remains the same, and how consumers will react to the new financial services system. Commentary provided by Anthony Justice, CEO at UNO Home Loans.Book a call in with UNO

Book Call Now


What our customers are saying

Gabe Windsor
October 26, 2023
What a fantastic experience using UNO Home Loans. Mike Parsons and the team were exceptional. Such an easy, hassle free experience, cannot recommend them highly enough. Mike Parsons was in touch every step of the way, and with him doing all the leg work, the transition to a refinanced home loan was a very easy one. Thank you!
Read more
Laurisa Sticotti
July 1, 2023
Scott Wilkinson has been fantastic when dealing with my broking needs. He has held my hand through every step of the way and has made purchasing my first home a much more comfortable experience than I anticipated.
Read more
Thusi Gamage
July 1, 2023
Awesome team, Very reliable and friendly. Scott Wilkinson is very experienced and knowledgeable.He guided us throughout the process and was available to help.
Read more
Omar Zazou
June 1, 2023
I have worked with Scott Wilkinson to get my home loan and he has been a massive help to navigate my first home purchase. He has taken care of all the financial details and I didn't need to worry about anything. Highly recommend him for his professionalism, patience and support!
Read more
Kelly O'Connor
June 1, 2023
You won’t find any broker better than Anita at UNO. We’ve told all our friends and family about her and will be using her for all our mortgages in the future! A stress free process from the start. She listened to our needs and was always available.
Read more
Ashley Morson
We are truly grateful for uno home loans and our broker Karis Churchill. This is our second time purchasing a home with the help from Uno and both times have been a very positive experience. Our recent purchase had many obstacles due to different factors however it was our dream home and we were up for the challenge. Our broker Karis was a true support and went above and beyond. She communicated so well with our solicitor and the real estate agents. She kept us updated through every step and kept us motivated when things seemed impossible. Uno is very fortunate to have Karis as a broker and we would highly recommend her to anyone. Our family are so happy we are now in our new forever home. Thank you so much Karis and to the uno team!!!
Read more
Ebubekir Demir
Thank you Eren for your quick and efficient turn around time to getting an approval for a loan. Will be recommending you to anyone that needs a quick and reliable loan.
Read more
No items found.